RATIO ANALYSIS

TABLE 1 - CURRENT ASSETS

Mar 2001 Mar 2002 Mar 2003 Mar 2004 Mar 2005 Mar 2006
Gabriel India Ltd. 12 mths 12 mths 12 mths 12 mths 12 mths 12 mths
Marketable investment 0 0 0 0.98 0.98 0.98

Raw materials and stores 9.33 10.07 15.08 17.7 21.11 24.97
Raw materials 8.61 9.46 14.38 16.95 18.41 21.9
Stores and spares 0.72 0.61 0.7 0.75 2.7 3.07
Finished and semi-finished goods 12.53 11.3 13.11 13.91 20.03 21.95
Finished goods 9.97 7.7 8.93 10.05 12.19 13.73
Semi-finished goods 2.56 3.6 4.18 3.86 7.84 8.22
Incomplete construction contracts 0 0 0 0 0 0
Stock real estate 0 0 0 0 0 0
Stock of shares / securities 0 0 0 0 0 0
Other stock 0 0 0 0 0 0
Total Inventory 21.86 21.37 28.19 31.61 41.14 46.92

Sundry debtors 46.11 48.07 54.69 51.11 50.62 68.15

Cash in hand 0.48 0.09 0.21 0.11 0.09 0.14
Bank balance 0.73 2.42 1.8 1.97 15.62 16.11
Cash & bank balance 1.21 2.51 2.01 2.08 15.71 16.25

TOTAL CURRENT ASSETS 69.18 71.95 84.89 85.78 108.45 132.3

TABLE 2 - CURRENT LIABILITIES

Mar 2001 Mar 2002 Mar 2003 Mar 2004 Mar 2005 Mar 2006
Gabriel India Ltd. 12 mths 12 mths 12 mths 12 mths 12 mths 12 mths
Sundry creditors 36.99 38.44 53.04 49.04 54.68 69.71
Interest accrued / due 2.28 2 2.05 1.27 0.69 0.06
Creditors for capital goods 0 0 0 0 0 0
Other current liabilities 4.54 4.88 3.92 4.59 5.99 6.44
Share application money 0 0 0.05 0 0 0
Advance against WIP 0 0 0 0 0 0
Current liabilities 43.81 45.32 59.01 54.9 61.36 76.21

Short term bank borrowings 20.2 31.26 19.67 20.59 27.45 69.85

TOTAL CURRENT LIABILITIES 64.01 76.58 78.68 75.49 88.81 146.06

TABLE 3 - OPERATING EXPENSES

 Mar 2001 Mar 2002 Mar 2003 Mar 2004 Mar 2005 Mar 2006
Gabriel India Ltd. 12 mths 12 mths 12 mths 12 mths 12 mths 12 mths
Raw materials, stores, etc. 132.65 150.31 208 213.52 262.01 313.64
Wages & salaries 18 19.21 24.05 27.65 31.98 38.32
Energy (power & fuel) 7.88 8.21 9.9 10.18 10.9 12.28
Indirect taxes (excise, etc.) 36.52 42.23 52.55 58.75 66.59 80.92
Advertising & marketing expenses 7.26 13.31 11.84 13.93 11.26 16.74
Distribution expenses 3.51 3.78 4.26 4.48 5.1 6.49
Expenditure 205.82 237.05 310.6 328.51 387.84 468.39
Less: Depreciation 10.87 12.21 13.7 14.58 14.74 15.31
Operating Expenses 194.95 224.84 296.9 313.93 373.1 453.08

FORMULAS

CURRENT RATIO = CURRENT ASSETS / CURRENT LIABILITIES

QUICK RATIO = (CURRENT ASSETS - INVENTORY) / CURRENT LIABILITIES

CASH RATIO = (CASH + BANK + MARKETABLE SECURITIES) / CURRENT LIABILITIES

INTERVAL MEASURE = (CURRENT ASSETS - INVENTORY) / AVG. DAILY OP. EXPENSES

TABLE 4 - LIQUIDITY RATIOS

Mar 2001 Mar 2002 Mar 2003 Mar 2004 Mar 2005 Mar 2006
Gabriel India Ltd. 12 mths 12 mths 12 mths 12 mths 12 mths 12 mths
CURRENT RATIO 1.08 0.94 1.08 1.14 1.22 0.91
QUICK RATIO 0.74 0.66 0.72 0.72 0.76 0.58
CASH RATIO 0.02 0.03 0.03 0.03 0.18 0.11
INTERVAL MEASURE 87.38 80.99 68.75 62.12 64.95 67.84

Liquidity ratios is a measure of the firm's ability to meet its current obligations.
Ratios in Table 4 indicate that Gabriel India's liquidity is deteriorating, thereby
reducing the margin of safety of creditors. It is a note of caution for the creditors.
Though it is good for management as they have more liabilities than current assets
as idle assets earn nothing. But they must ensure that they don't suffer from lack of
liquidity otherwise it will result in poor credit worthiness and loss of creditors'
confidence.
 Table 5 - Total Debt

Mar 2001 Mar 2002 Mar 2003 Mar 2004 Mar 2005 Mar 2006
Gabriel India Ltd. 12 mths 12 mths 12 mths 12 mths 12 mths 12 mths
Bank borrowings 20.2 31.26 44.01 68.46 62.56 92.31
Short term bank borrowings 20.2 31.26 19.67 20.59 27.45 69.85
Long term bank borrowings 0 0 24.34 47.87 35.11 22.46
Financial institutional borrowings 30.68 24 0 0 0 0
Govt. / sales tax deferral borrowings 11.49 0 0 0 0 0
Debentures / bonds 43.86 31.46 17.26 0 0 0
Fixed deposits 22.64 22.98 19.47 13.24 3.81 0.16
Foreign borrowings 0 0 0 0 12.14 0
Borrowings from corporate bodies 0 0 0 1 0 0
Group / associate cos. 0 0 0 0 0 0
Borrowings from promoters / directors 0 0 0 0 0 0
Commercial paper 0 0 0 0 0 0
Other borrowings 8.24 18.5 24.21 17.63 14.7 15.19
Total Debt 137.11 128.2 104.95 100.33 93.21 107.66

Table - 6 Net Worth

Mar 2001 Mar 2002 Mar 2003 Mar 2004 Mar 2005 Mar 2006
Gabriel India Ltd. 12 mths 12 mths 12 mths 12 mths 12 mths 12 mths
Paid-up equity capital 7.12 7.13 7.13 7.19 7.18 7.18
Preference capital 0 0 0 0 0 0
Bonus equity capital 1.24 1.24 1.24 1.24 1.24 1.24
Buy back amount 0 0 0 0 0 0
Buy back shares (nos.) 0 0 0 0 0 0
Equity Capital 8.36 8.37 8.37 8.43 8.42 8.42

Free reserves 62.1 51.6 56.12 76.84 89.02 92.12

Share premium reserves 34.29 34.29 34.29 34.36 34.36 34.36
Other free reserves 27.81 17.31 21.83 42.48 54.66 57.76
Specific reserves 21.21 16.16 9 0.17 0.17 0.17
Revaluation reserves 0 0 0 0 0 0
Accumulated losses 0 0 0 0 0 0
Reserves & surplus 83.31 67.76 65.12 77.01 89.19 92.29

Less: Share issue

expenses not written off 0.26 0.19 0 0 0 0

Net Worth 91.41 75.94 73.49 85.44 97.61 100.71

Capital Employed = Net

Worth + Total Debt 228.52 204.14 178.44 185.77 190.82 208.37
Long Term Debt = Total
Debt - Short Term
Borrowing 116.91 96.94 85.28 79.74 65.76 37.81

EBDIT 35.64 37.49 47.74 49.50 50.41 41.46

Depreciation 10.87 12.21 13.70 14.58 14.74 15.31

EBIT 24.77 25.28 34.04 34.92 35.67 26.15

Interest 19.73 17.86 13.71 8.80 7.33 8.60

PAT 4.57 3.96 11.72 16.68 17.89 8.84

Table - 7 Leverage Ratios

Mar 2001 Mar 2002 Mar 2003 Mar 2004 Mar 2005 Mar 2006
Gabriel India Ltd. 12 mths 12 mths 12 mths 12 mths 12 mths 12 mths
Debt Ratio = Total Debt /
Capital Employed 0.60 0.63 0.59 0.54 0.49 0.52
Debt Equity Ratio = Total
Debt / Net Worth 1.50 1.69 1.43 1.17 0.95 1.07
Capital Employed / Net
Worth 2.50 2.69 2.43 2.17 1.95 2.07
Long Term Debt Ratio = Long Term0.56
Debt / Net 0.56
Worth + Long
0.54Term Debt
0.48 0.40 0.27
Coverage Ratio = EBDIT /
Interest 1.81 2.10 3.48 5.63 6.88 4.82

Leverage ratios show the proportions of debt and equity in financing the firm's
assets. They are calculated to measure the financial risk and the firm's ability of
using debt to shareholders' advantage. The debt ratio in Table 7 shows that within
this period the debt employed is reduced from 60% to 50%. It shows that the
company is lowering the amount of debt which is evident from debt-ratio and long-
term debt ratio, which has been reduced significantly. It is a good sign that the debt
is maintained within 50% during the last three years. This implies that the firm can
borrow funds on easier terms. Moreover, the amount of interest paid on debt is also
reduced, thus increasing the coverage ratio. Therefore, it is good for creditors as
their money as well as the owners money is equally used for expansion.
 Table 8 - Cost of Good Sold

Mar 2001 Mar 2002 Mar 2003 Mar 2004 Mar 2005 Mar 2006
Gabriel India Ltd. 12 mths 12 mths 12 mths 12 mths 12 mths 12 mths
Sales 270.16 310.23 379.13 424.63 482.73 568.31

PBDIT 35.64 37.49 47.74 49.5 50.41 41.46

Cost Of Goods Sold

=Sales - PBDIT 234.52 272.74 331.39 375.13 432.32 526.85

Table 9 - Average Inventory

Raw materials 8.61 9.46 14.38 16.95 18.41 21.9

Stores and spares 0.72 0.61 0.7 0.75 2.7 3.07
Finished goods 9.97 7.7 8.93 10.05 12.19 13.73
Semi-finished goods 2.56 3.6 4.18 3.86 7.84 8.22
Total Inventory 21.86 21.37 28.19 31.61 41.14 46.92
Avg
Inv{(op.sto+clo.sto)/2} 21.86 21.62 24.78 29.90 36.38 44.03

Table 10 - Average Debtors

Sundry debtors 46.11 48.07 54.69 51.11 50.62 68.15

Debtors exceeding six months 1.4 0.88 1.5 1.01 1.83 1.35
Total debtors 46.11 48.07 54.69 51.11 50.62 68.15
Average Debtors =
(Opening - Closing
Debtor)/2 46.11 47.09 51.38 52.9 50.87 59.39

Table 11 - Net Current Asset & Net Asset

Short term bank borrowings 20.2 31.26 19.67 20.59 27.45 69.85
Sundry creditors 36.99 38.44 53.04 49.04 54.68 69.71
Interest accrued / due 2.28 2 2.05 1.27 0.69 0.06
Other current liabilities 4.54 4.88 3.92 4.59 5.99 6.44
Provisions 4.96 7.2 12.32 19.48 31.15 39.62
Total Current Liabilities 68.97 83.78 91 94.97 119.96 185.68
Marketable investment 0 0 0 0.98 0.98 0.98
Raw materials 8.61 9.46 14.38 16.95 18.41 21.9
Stores and spares 0.72 0.61 0.7 0.75 2.7 3.07
Finished goods 9.97 7.7 8.93 10.05 12.19 13.73
Semi-finished goods 2.56 3.6 4.18 3.86 7.84 8.22
Sundry debtors 46.11 48.07 54.69 51.11 50.62 68.15
Accrued income 0 0 0 0 0 0
Advance payment of tax 4.69 5.23 3.84 13.44 22.85 33.83
Other receivables 30.43 31.11 40.98 41.19 34.31 33.92
Cash in hand 0.48 0.09 0.21 0.11 0.09 0.14
Bank balance 0.73 2.42 1.8 1.97 15.62 16.11
Total Current assets 104.3 108.29 129.71 140.41 165.61 200.05
 Mar 2001 Mar 2002 Mar 2003 Mar 2004 Mar 2005 Mar 2006
Gabriel India Ltd. 12 mths 12 mths 12 mths 12 mths 12 mths 12 mths
Net Current
Assets(Current Assets-
Current Liabilities) 35.33 24.51 38.71 45.44 45.65 14.37
Net fixed assets 135.08 131.37 138.09 139.24 134.11 136.34
Group / associate cos. 23.73 7.18 0.33 0 0 0
Other cos. 0.1 0.04 0 0.06 0.03 0.34
Deposits with govt. / agencies 0.97 1.04 1.88 2.33 3.67 4.37
In group / associate cos. 10 26 0 0 0 0
In mutual funds 1.46 1.46 1.46 0 0 0
Other investments 0 0 0 0.98 0.98 0.98
Net Fixed Assets 171.34 167.09 141.76 142.61 138.79 142.03
Total Assets 275.64 275.38 271.47 283.02 304.4 342.08
Net Assets(Net Fixed
Assets+Net Current
Assets) 206.67 191.6 180.47 188.05 184.44 156.4

Table 12 - Activity Ratio

Inventory Turnover =
Cost of Goods Sold /
Avg. Inventory 10.73 12.62 13.37 12.55 11.89 11.97
DIH = 360/ Inventory
Turnover 33.56 28.53 26.92 28.69 30.29 30.09
Debtors Turnover =
Sales/ Avg Debtors 5.86 6.59 7.38 8.03 9.49 9.57
Collection Period = 360 /
Debtor Turnover 61.44 54.64 48.79 44.85 37.93 37.62
Total Asset Turnover =
Sales / Total Asset 1.31 1.62 2.10 2.26 2.62 3.63

The activity ratios are employed to evaluate the efficiency with which the firm
manages and utilises its assets. They indicate the speed with which assets are
being converted into sales.

Inventory turnover indicates the efficiency of the firm in producing and selling
its product. Gabriel India's inventory turnover has gradually increased in the
past years. In other words, the inventory holding period has reduced
marginally. On an average, they are holding an inventory of 30 days, which is
neither too low, nor too high.
 Debtor turnover indicate the number of times debtors turnover each year. Gabriel
India's debtor turnover has increased considerably to 9.57 times. In other words, the
average collection period hs reduced to 37 days in 2006 compared to 61 days in 2005.
This shows that credit management efficiency of Gabriel India.

Total asset turnover shows the firm's ability in generating sales from all financial
resources. Gabriel India's total asset turnover has been increasing gradually in the
past years to 3.63, i.e, it almost tripled from 2001 to 2006. This shows that Gabriel
India generate a sale of Rs. 3.63 for every one rupee of investment.

Table 13 - Profitability Ratios

Mar 2001 Mar 2002 Mar 2003 Mar 2004 Mar 2005 Mar 2006
Gabriel India Ltd. 12 mths 12 mths 12 mths 12 mths 12 mths 12 mths
Net Profit Margin = EBIT/
Sales 0.09 0.08 0.09 0.08 0.07 0.05
Operating Expense Ratio =
Cost of Goods Sold / Sales 0.87 0.88 0.87 0.88 0.90 0.93
ROTA = EBIT/ Total Assets 0.09 0.09 0.13 0.12 0.12 0.08
RONA = EBIT/ Net Assets 0.12 0.13 0.19 0.19 0.19 0.17
ROE = PAT/ NW 0.05 0.05 0.16 0.20 0.18 0.09
EPS* = PAT / No. of
Outstanding Shares N.A. N.A. N.A. 23.22 24.91 1.23
DPS = Dividend / No. of
Outstanding Shares N.A. N.A. N.A. 6.00 7.00 0.70
PE Ratio = Market Value /
EPS N.A. N.A. N.A. 5.90 7.43 27.50

*In 2006, the shares of the company having face value Rs. 10 were split into 10 shares
of Re. 1 each.

Profitability Ratios indicate the operating efficiency of a firm. The profitability of

Gabriel India has increased till 2005, but in the last year, it has reduced considerably.
This is because of the fact that though the sales has increased, the propotionate
increase in COGS is more(because of increase in Raw Material price). As a result,
operating expenses has increased. This has also reduced the EBIT and thus PAT. As
a cascading effect, all the profitability ratios have reduced.

Table 13 shows that EPS and DPS have increased in the year 2005 because of
increase in PAT. However, in the year 2006, as a result of decreased profit margin, the
EPS has declined but the DPS is maintained at 70% of face value.

P-E Ratio reflects investors' expectations about growth in the firm earning. P-E Ratio
of Gabriel India has increased to 27.50 because of fall in EPS which is due to
decrease in PAT. Thereby indicating that the share is priced more.